New Orlando apartments planned for busy Lake Nona corridor

A 377-unit apartment community is in the works for a fast-growing stretch of Narcoossee Road in the Lake Nona area.

Tampa-based 2nd Wave Development’s plans for the apartments will go before the city of Orlando’s southeast town design review committee May 12. The project is slated to be built on six parcels between Narcoossee Road and Lake Whippoorwill.

It will include five buildings with residential units on the property, three of which are four stories in height and two of which are two stories. The plans also include an amenity building, a retention pond and three private docks.

Site plans were produced by Kimley-Horn, which is also acting as the applicant for the project. Other firms involved with the project include the Tampa office of Boston-based architecture firm Gensler and Orlando-based Leading Edge Land Services Inc.

How were the parcels assembled?

The parcels have been the subject of development plans for years, including a proposed mixed-use project that included a hotel in 2020. Romesh Panchel, who sold 7.3 acres of the site, told the Orlando Business Journal then that the homeowners understood the value of the land, noting they were among the last to have property on or near the lake. “Everything else is gone.”

The process to annex the parcels into the city began last summer and was approved by the Orlando City Council Dec. 6.

The parcels were assembled by 2nd Wave in separate transactions involving six landowners between February and April of this year. The total cost of the acquisitions came out to $18.99 million and totaled 24.6 acres, including acreage covered by the lake. The total cost averages out to about $772,000 per acre.

According to Brad Parker, a land expert with Longwood-based Southern Realty Enterprises Inc. who is not involved with the deal, the purchase was a good decision despite the price tag, given the parcels’ location.

“The location is triple-A — it’s as good as you can get when you consider you only have marginal land left there on Narcoossee Road,” Parker said.

Is anything else planned on the property?

As outlined in city documents, the parcels purchased are not entirely planned for the multifamily project.

Roughly 2.3 acres on the western end of the property, which fronts Narcoossee Road, are being marketed as two separate outparcels to be leased for retail development by First Capital Property Group’s Austin McWilliams and Bryan Richardson along with Kevin Hipes of HCB Real Estate.

Why is multifamily so strong in and around Lake Nona?

The Lake Nona submarket has 2,061 multifamily units under construction, according to CoStar Group.

The Lake Nona area is atop the list of many multifamily developers because of its high rents, said Lisa McNatt, director of market analytics in Orlando for CoSta, who is not involved with the project.

“It’s pretty phenomenal. Everybody wants to capture those potential renters. The single-family home market obviously is fueling a lot of that growth, because the price point for single-family homes in Lake Nona is significantly higher than many other areas in Orlando. Apartments are going to provide a better alternative for those who don’t want to be price-burdened, especially as interest rates on mortgages have begun to inch up. Everybody wants to capitalize on the pent-up and incoming demand.”

What are the submarket stats?

The Lake Nona multifamily submarket, which includes the proposed apartment development, had 522 units delivered in the past 12 months and has 2,061 units under construction, according to CoStar Group. The submarket has had positive absorption of 451 units in the past 12 months and has an average apartment complex vacancy rate of 5.9%, which compares to metro Orlando’s 4.8%.

The submarket’s average monthly apartment rent is $2,166 per unit, second highest among the region’s submarkets, and considerably higher than metro Orlando region’s average of $1,773.